Friday, January 16, 2009
Your 1.2 Trillion Dollars At Work - Was The Money Lent Or Spent And How Do You Win?
If the Fed is printing cash at a rate of 4K per taxpayer, don't you want to know how it was spent or lent, no matter the semantics? In contrast, education is being held tooth and nail to No Child Left Behind, which has been described as "all stick and no carrot." Why is that?
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Deflation, a/k/a money tomorrow but no money today
The Fed has tools to suck money out of the economy. Putting money into the economy is another matter. If all the money made available to date goes into mattresses, or isn't loaned, then there is no stimulus.
Deflation worries the Fed, the circumstance in which money in mattresses earns untaxed interest by virtue of falling prices.
Money could be forced into circulation by taxing cash, the 'Use it or lose it' scenario. Congress, the fiscal power (the Fed is the monetary power), could levy a tax on cash. Guess how popular that would make sitting Congressmen.
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